CEDREN HydroBalance - Large-scale balancing and energy storage from Norwegian hydropower

The primary objective of the CEDREN project HydroBalance is to address key challenges to the use of Norwegian hydropower for large-scale balancing and storage related to technology, economy, environment and society. In WP1 works with scenarios and roadmaps. Scenarios are verbal descriptions of the conditions, assumptions and advances of main uncertainties that influence such developments. They differ from each other in three main characteristics: the degree of integration of Norway with the European power market and grid, the volume of balancing provided by Norwegian hydropower, and the time horizons on which balancing takes place. The scenarios were translated into quantitative scenarios, i.e. data sets describing the European energy system (e.g. grid connections, power plants) and relevant driving factors (e.g. CO2-certificate price development). These data sets were then used in energy system models. In HydroBalance WP2, we have analyzed the cost of providing balancing power from gas power plants and Norwegian pumped hydro plants in a future European power system with high penetration of wind and solar power. A numeric case study shows that building new reversible pumping stations between existing reservoirs in the Norwegian hydro system are economical advantageous over new gas power plants in Northern Europe, taking into account additional costs of subsea cables across the North Sea and corresponding reinforcements of the mainland grid. The study also shows that it is crucial to give interconnectors access to capacity markets across borders to obtain as low cost as possible for firm capacity in a future European system dominated by variable renewable production. In our latest study, where we have used a newly developed equilibrium model of the power market, we show that Norwegian pumped hydro plants and distributed batteries will complement each other - not compete ? as flexibility resources for wind and solar power in Europe. In WP3, power prices for selveral markets have been calculated for WP1 scenarios. Prices are considerably higher and more volatile than today. A cost/benefit study concluded that the considerable expansion of hydropower capacity (MW) and corresponding increase in cable capacity in HydroBalance scenarios is likely to result in an economic benefit for the total European power system in the regarded scenarios. To analyze the profitability for Norwegian investors in hydropower capacity, we carried out a case study for a pumped storage project in Otravassdraget, in Southern Norway. Results show that the project is unprofitable at historical prices, about break-even at future prices in the day-ahead market, but profitable if the producer supply balancing services in addition to energy in the day-ahead market. The study also quantifies changes in the utilization of reservoirs. A new methodology was developed and applied to carry out the multi-market study with SINTEF's tools for local hydropower optimization. In WP4, we use fish populations as ecological indicators of impacts of hydropower regulation on reservoirs, and so far, two papers are published. One is based on historical database on trout populations from more than 280 Norwegian lakes and shows how interactions within lake fish communities shape the effects of environmental factors on trout yield. The other compares food and habitat use of charr in one regulated and one unregulated lake. Presently, WP4 focuses on physical modelling of environmental effects in reservoirs, based on the power price scenarios developed in WP3. Through this unique combination of market simulations and hydrodynamic modelling, we will be able to predict how future power production may affect water level fluctuations, temperature, ice-cover and mixing of water in Norwegian reservoirs. In HydroBalance WP5, we have studied social acceptance and regulatory framework which points out key barriers to increase energy balancing and storage from Norway to Europe. First, at EU level there are unresolved issues such as the needs for developing a common capacity mechanism. As a consequence, in Norway there is currently a modest socio-political support for large-scale balancing, and no overall political strategy for how to realize increased hydrobalancing from Norway. In addition, at the local level conflicts related to aesthetical, environmental, and economic impacts may occur. These may be reduced by measures of early involvement of stakeholders and community compensation. Finally, a roadmap for large-scale balancing and storage from Norwegian hydropower has been devlopped. It points out elements in the process of deploying flexibility of Norwegian hydropower with expansion of existing hydropower capacity and construction of new pumped-storage plants by 2050. The roadmap review also challenges and needs that the society will face for such use of hydropower.

The project will address important key questions regarding use of hydropower flexibility and expansion of such flexibility including pump storage development between reservoirs. The project is taking into account the three axes of CEDREN: Technology, envi ronment and society. The need for balancing and energy storage from Norwegian hydropower will be investigated based on scenarios for the development in Europe towards 2050. This includes an assessment of the optimal free market solution for Europe with s cenarios for a renewable mix from intermittent sources and their geographical distribution with different options for providing the required flexibility. Flexibility from the Norwegian power system is one such option. Based on the need for balancing and e nergy storage, business models for integrating flexibility from hydropower given a joint Norwegian European perspective will be assessed. The project will assess what technical solutions from hydropower that will respond to the different needs and time h orizons. The project will investigate the environmental impacts in reservoirs where there currently is a lack of knowledge. The project will investigate social acceptance and regulatory framework in order to identify barriers and possibilities in the cu rrent regulatory and policy framework. This means analyzing the current regulation for hydropower in light of how it is challenged by the European energy and environmental policy. This will make it possible to provide feedback on the main non-technical ch allenges that have to be addressed in order to design a sustainable roadmap for balancing services. The results from the different work packages will be summarazed and elaborated on in roadmap(s). Possibilities and barriers for balancing and energy stora ge through hydropower flexibility will be discussed, taking into account the uncertainty of the future development up to 2050.